Securities dispute resolution: Discovery

The discovery process is the phase in which both parties research and investigate the facts and events that gave rise to the claim. During the discovery phase, parties will have access to information that was inaccessible to them before. While the rules provide for mutual cooperation in the exchange of documents and information to expedite the arbitration, many parties will attempt to avoid disclosing unfavorable information. Parties in Financial Industry Regulatory Authority (FINRA) arbitration are required to cooperate to the fullest extent practicable in discovery. Measures have been put in place to compel discovery, including orders from the panel directing one party to disclose certain information, and even sanctions for difficult parties.

Subpoenas and Orders to Appear or Produce are also available to parties. These allow the parties to force production of either a witness or a document. Witnesses may be deposed in order to obtain a written record of their statements.

The following lists provided by FINRA’s Discovery Guide provide an example of the type of document lists that may be required in any one particular case. FINRA provides lists, applicable in all customer cases, of documents that the respective parties should produce (see pages seven through seventeen of the 2013 version of the Discovery Guide.)